Malaysia is one of Asia's biggest employers of foreign labour. But recently, cases of deaths, abuse and forced labour have come to light. What is going on? Who is protecting these migrant workers?
It is quite apparent that the Government
is determined to curb the ballooning pensions bill, which has become too serious
and it has to do something before things become worse.
<P>Payments to its
pensioners have reached a critical stage and a review is urgent. It will definitely
brood no objection from any quarters in achieving its new target. </P><P>Luckily,
Cuepacs is quick to recognise this new mood and instead of objecting to the recommendations
outright, it has decided wisely to reduce its financial impact on members. </P><P>The
new scheme will be a revolutionary approach since pensions have always been paid
by the Government to reward its workers for their contributions to the nation.
In other words, workers just take without giving. </P><P>With the new development,
the Government will have to contribute 12% with the worker paying 11% every month,
which is what the employers and employees in the private sector are doing under
the Employees Provident Fund. </P><P>However, the new arrangement will affect
only those who will join the government service after the proposed legislation
has been approved. Existing workers should have no quarrel with this since they
would not be affected. </P><P>Apart from the monthly contributions, pensioners
will continue to receive free medical benefits and other perks enjoyed by serving
officers. </P><P>One important aspect that Cuepacs should look into is how much
those in the new scheme would receive on retirement. Will the pension be sufficient
for their needs or will they be paid according to their contributions, which would
not be much especially for those in the lower income group? </P><P>If the contributors’
pay is low, then their payments will also be limited. One way of improving this
is for the Government to increase the salaries of those in the lower rung of the
civil service, such as clerical staff. </P><P>Without the burden of billions in
pension payments, it may be possible for the Government to review the salary structure
of the entire service. This will enable workers to receive a higher salary and
thus contribute more to their pension fund. </P><P>However, it may be advisable
for the Government not to follow the EPF example too closely, especially allowing
members to withdraw money for various purposes. Such a flexibility has shown to
deplete the retirement pot thus the members will receive even less money at the
end of the day. </P><P>The contributions should be solely for retirement and any
attempt to dilute this amount will be against their long-term interests. Later
they will definitely face financial problems for too many withdrawals. </P><P>Government
employees already enjoy many benefits, such as free medical care and cheap housing
loans. The Government will not be doing its workers a favour by granting such
requests. It must learn from the EPF experience.</P><P><I>Source: http://thestar.com.my/news/story.asp?file=/2007/1/16/focus/16507985&sec=focus</I>
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